Congress Expands ‘Crypto Week’ Events; Trump Ventures into New Token Offerings
The U.S. Congress is ramping up its activities during ‘Crypto Week’, coinciding with the Trump family’s growing portfolio in cryptocurrency ventures. On July 16, the House of Representatives’ Committee on Ways & Means’ Oversight subcommittee will convene a hearing titled ‘Making America the Crypto Capital of the World: Ensuring Digital Asset Policy Built for the 21st Century.’ Jason Smith, the Committee Chair from Missouri, stated that the hearing will examine the necessary steps for establishing a tax policy framework tailored for digital assets. This event is part of a broader crypto initiative dubbed ‘Crypto Week,’ which will include votes on several key pieces of legislation related to market structure, stablecoins, and the revival of anti-central bank digital currency (CBDC) proposals introduced by Tom Emmer. Although no specific tax-related crypto proposals have emerged from the House yet, Senator Cynthia Lummis from Wyoming has recently put forth a bill that tackles various aspects of crypto taxation. While the House has its own stablecoin legislation, known as the STABLE Act, it appears poised to proceed with the GENIUS Act from the Senate, provided Lummis can successfully navigate her bill through her chamber first. Meanwhile, the Senate is rumored to release a market structure discussion draft soon, which may allow for a swift consideration of the CLARITY Act with minimal revisions. Currently, the Senate has only issued a set of principles regarding market structure, and a recent Senate Banking Committee hearing on the matter did not yield significant outcomes. Senator John Kennedy from Louisiana expressed his skepticism about the Senate drafting a market structure bill from scratch, suggesting that leveraging the existing CLARITY Act would be a more efficient approach.
State Regulators Seek Involvement in Crypto Oversight
In the midst of these regulatory changes, state securities regulators are urging Senate leaders to ensure they are included in the crypto oversight framework. On July 7, the North American Securities Administrators Association (NASAA) sent a letter to Senators Tim Scott and Elizabeth Warren, the chair and ranking member of the Senate Banking Committee, respectively. The letter emphasizes the importance of maintaining the critical role that state regulators play in safeguarding capital markets against fraud and market manipulation. The NASAA warns that neglecting their involvement could lead to significant negative consequences for American investors. However, the current market structure proposals appear to limit the role of the federal Securities and Exchange Commission (SEC), assigning most of the regulatory responsibilities to the Commodity Futures Trading Commission (CFTC), which is currently facing staffing challenges. Leslie Van Buskirk, the NASAA president, expressed concern that without state-level oversight, the federal agencies may not adequately address fraudulent activities.
Trump Media Introduces New Token Amidst Increasing Crypto Scrutiny
In a related development, Trump Media & Technology Group (TMTG) has announced its intentions to launch a new token amid ongoing attempts by Democrats to amend crypto legislation to restrict the Trump family’s profit-making activities in the sector. Despite these efforts falling short thus far, the Trump family continues to expand its crypto endeavors. On July 9, TMTG revealed it is currently in the public beta testing phase for its Truth+ subscription streaming service, which promises a selection of “premium, non-woke news channels” among other features. Subscribers will earn gems linked to their activity on the Truth Social platform, which will eventually be associated with a utility token connected to both Truth Social and Truth+. Earlier this year, TMTG indicated its interest in developing a utility token, likely influenced by the positive reception of the $TRUMP memecoin and WLFI, the governance token for Trump’s decentralized finance platform, World Liberty Financial (WLF). Despite TMTG’s ambitious plans, including applications for several crypto-focused exchange-traded funds (ETFs) and raising $2.4 billion to support a Bitcoin treasury, its flagship product, Truth Social, is struggling with low user engagement and advertising revenues, reporting a $31 million net loss in the first quarter of 2025.
Justin Sun’s Investments in Trump Tokens Raise Questions
In a surprising yet not unexpected turn of events, Justin Sun, the founder of the TRON network, announced plans to invest $100 million in the $TRUMP token, continuing his pattern of support for Trump-related crypto projects. Sun had previously made substantial investments in both the $TRUMP and WLFI tokens, earning him a position as an advisor to WLF. In an interview with Coindesk, Sun described $TRUMP as a significant memecoin and a globally recognized intellectual property. TRON is currently preparing to launch $TRUMP on its platform, expanding its availability beyond the Solana chain. Sun referred to the token as representing Trump’s Make America Great Again movement and expressed confidence that TRON would enhance its popularity in Asia and globally. Additionally, WLF recently disclosed a $100 million sale of WLFI to Aqua1 Foundation, a Web3-native fund based in the UAE, aiming to foster a blockchain-powered financial ecosystem. However, crypto journalist Jacob Silverman raised concerns regarding Aqua1’s legitimacy, noting an apparent lack of corporate registration or official documentation, as well as the challenges of tracing its co-founder. Despite the uncertainty surrounding Aqua1, the WLFI token currently serves only governance purposes, but a new proposal is under consideration to allow trading of WLFI on the open market.
IRS Removes Controversial ‘DeFi Broker’ Rule
In other developments, the Internal Revenue Service (IRS) has officially removed the unpopular ‘DeFi broker’ rule from the U.S. tax code. This rule, which mandated that non-custodial platforms gather and submit extensive customer information akin to traditional brokers, faced significant backlash. Following the elections last November, both congressional chambers acted promptly to eliminate this DeFi provision from IRS regulations. President Trump signed the relevant legislation into law in April, making the IRS’s recent announcement a procedural step that is nonetheless welcomed by the crypto community. The IRS operates under the Treasury Department, which also oversees the Office of the Comptroller of the Currency (OCC). On the same day, the OCC welcomed its new leader, Jonathan Gould, a former chief legal officer at blockchain infrastructure company Bitfury, who was confirmed by the Senate after initial reservations expressed by Senator Lummis regarding his views on stablecoins and federal pre-emption of state banking laws.
Stablecoin Holdings and Treasury Bill Outlooks
Recent reports indicate that the total value of U.S. Treasury bills held by stablecoin issuers has surpassed $182 billion, placing it in a financial category comparable to that of Saudi Arabia and Norway. The term ‘reportedly’ is significant here, as some issuers have not allowed independent verification of their claimed T-bill reserves. A key motivation behind stablecoin legislation in the U.S. is the belief that their adoption will help maintain the dollar’s status as the global reserve currency. Furthermore, stablecoins are anticipated to stabilize U.S. finances, as issuers are required to hold reserves in a limited selection of fiat assets, mainly Treasury bills. Treasury Secretary Scott Bessent has projected that issuers may need to purchase $2 trillion in T-bills by 2028 and $3.7 trillion by 2030, although estimates vary widely. A prevailing uncertainty exists regarding the actual demand, but stablecoin issuers typically prefer shorter-term T-bills to ensure liquidity for quick redemptions. This preference has led the Treasury to announce an increase in the issuance of T-bills, focusing on shorter maturities, which allows the government to save on interest rates while raising concerns about potential higher financing costs in the future. The emphasis on short-term T-bills also reflects growing global apprehension about the U.S. financial situation and its ability to meet long-term obligations.
